SafePoint doubles Nature Coast Re 2025-1 cat bond size to $200m

SafePoint Insurance Company has successfully doubled the size of its new Nature Coast Re Ltd. (Series 2025-1) catastrophe bond, securing $200 million of reinsurance protection from capital market investors through the issuance of notes, Artemis has learned.

It makes this new Nature Coast Re catastrophe bond the equal largest ever sponsored by insurer SafePoint, having doubled it from the initial target size.

Now priced, once settled in January this will become SafePoint’s seventh successful catastrophe bond issuance and its third under this Nature Coast Re program.

SafePoint ventured back to the cat bond market early in December with an initial $100 million target size for this new Nature Coast Re 2025-1 cat bond.

As we later reported in an update on this deal, SafePoint lifted the target size of its latest catastrophe bond issuance, with between $150 million and $200 million of reinsurance protection sought.

Now, we’ve learned from sources that the upper target was secured, as the Nature Coast Re 2025-1 cat bond was priced to provide the insurer $200 million in fully-collateralized reinsurance.

The notes were priced at the bottom of the revised guidance range, which is within the lower-half of the initial spread guidance range that the offering was made with.

Now finalised, this new Nature Coast re 2025-1 catastrophe bond will provide the sponsor with a $200 million roughly four year source of fully-collateralized reinsurance protection against named storm losses on a state-weighted, annual aggregate and industry loss index trigger basis, running from settlement in early 2025 through to the end of 2028.

The notes will provide SafePoint with reinsurance for the named storm peril across the states of Florida, Louisiana, Alabama, Mississippi, and Texas. while the coverage will apply to SafePoint Insurance Company itself and its reciprocal exchanges, the solely Louisiana focused entity Cajun Underwriters Reciprocal Exchange, and the Florida homeowner and business owner focused Manatee Insurance Exchange.

The now confirmed as $200 million of Nature Coast Re 2025-1 Class A notes have an initial expected loss of 2.92%. They were initially offered to cat bond investors with spread price guidance in a range from 9.5% to 10.25%, but that guidance later narrowed to a new range of 9.75% to 10%.

Now, we’re told the $200 million of Nature Coast Re 2025-1 Class A catastrophe bond notes have been priced to pay investors a risk interest spread of 9.75%, so the low-end of the narrowed range and within the lower-half of initial price guidance.

This is the first time SafePoint has sponsored a catastrophe bond with an industry-loss index trigger, as it looked to secure broad reinsurance coverage for significant hurricane industry loss events across the coastal states it is most actively underwriting in.

The successful pricing is another indication of the ability of catastrophe bond investors to support well-structured aggregate reinsurance covers at reasonable pricing, as well as the opportunity that a robust cat bond market presents to sponsors looking to secure hurricane cover well in-advance of the 2025 US wind season.

You can read all about this new Nature Coast Re Ltd. (Series 2025-1)  catastrophe bond from Safepoint as well as details on every other cat bond ever issued in the extensive Artemis Deal Directory.